FAC Explorer

Finding 1158192 (2024-006)

Material Weakness Repeat Finding
Requirement
AB
Questioned Costs
-
Year
2024
Accepted
2025-09-30
Audit: 370096
Organization: Atrium Health, Inc. (NC)
Auditor: Ernst and Young LLP

AI Summary

  • Core Issue: Atrium Health CMHA lacked proper internal controls to retain supporting documentation for FEMA expenditures, risking compliance with federal requirements.
  • Impacted Requirements: Failure to meet Section 200.303 of the Uniform Guidance regarding effective internal control over federal awards.
  • Recommended Follow-Up: Implement precise internal controls to ensure all supporting documentation for FEMA expenses is retained and conduct training for accurate data capture in the Jenzabar Financial Aid system.

Finding Text

Finding 2024-006 Information on the Federal Program:Federal. Agency: Department of Homeland SecurityAssistance Listing No.: 97.036 COVID-19 Disaster Grants – Public Assistance (Presidentially Declared Disasters) (FEMA)Pass-Through: North Carolina Department of Public Safety. Pass-Through Award Number: N/APass-Through Award Period of Performance: 1/1/2021 through 7/1/22 and 7/2/22 through 5/11/23Criteria or Specific Requirement (Including Statutory, Regulatory or Other Citation):Section 200.303 of the Uniform Guidance states the following regarding internal control: “The non-Federal entity must: (a) Establish and maintain effective internal control over the Federal award that provides reasonable assurance that the non-Federal entity is managing the Federal award in compliance with Federal statutes, regulations, and the terms and conditions of the Federal award. These internal controls should be in compliance with guidance in “Standards for Internal Control in the Federal Government” issued by the Comptroller General of the United States or the “Internal Control Integrated Framework”, issued by the Committee of Sponsoring Organizations of the Treadway Commission (COSO).”Condition:Atrium Health CMHA’s internal controls were not suitably designed to retain all supporting documentation over their review and approval of FEMA federal expenditures. Cause:Atrium Health CMHA’s management designed a process to accumulate and review expenditures related to the FEMA award; however, for certain components of the review and approval the supporting documentation was not retained to evidence that the internal review was sufficiently designed and operating effectively throughout the process. Questioned Costs:None. Context:Atrium Health CMHA developed protocols of what expenses should be charged to the Presidentially Declared Disaster grant and communicated these protocols to the appropriate levels of management. Management then developed a process to review the costs and determine which ones were applicable to the Presidentially Declared Disaster grant. However, management did not maintain evidence supporting the approval of expenses under the Presidentially Declared Disaster grant terms.Total federal expenditures for Assistance Listing 97.036 recorded on the Schedule totaled $257,938,430 for the year ended December 31, 2024. Effect or Potential Effect:The amounts submitted for reimbursement and the FEMA reports submitted could be inaccurate or incomplete.Identification as a Repeat Finding, if Applicable:This is not a repeat finding from the previous year. Recommendation:Atrium Health CMHA should design and implement internal controls that are sufficiently precise and require supporting documentation be retained over the review and approval of FEMA expenses. Views of Responsible Officials:Atrium Health CMHA management in the future will ensure that all correspondence, including notes from review meetings and approvals of key decisions, will be documented and retained as part of the support records for FEMA related awards. Atrium Health CMHA should design and implement internal controls over FISAP reporting to ensure supporting documentation is maintained. Views of Responsible Officials:Atrium Health CMHA management, as part of the 2025 process and procedure consulting engagement, will ensure that appropriate training and process design for Jenzabar Financial Aid (JFA) system are implemented to accurately capture and retain all data required for FISAP reporting.

Corrective Action Plan

Corrective Action Plan: Atrium Health CMHA management in the future will ensure that all correspondence, including notes from review meetings and approvals of key decisions, will be documented and retained as part of the support records for FEMA related awards. Proposed Completion Date: No further action is required until future needs arise for Atrium Health CMHA to obtain FEMA funding awards at which time management will ensure all documentation supporting the process and key decisions are retained.

Categories

Student Financial Aid Cash Management Period of Performance Reporting Matching / Level of Effort / Earmarking Internal Control / Segregation of Duties

Other Findings in this Audit

  • 1158177 2024-001
    Material Weakness Repeat
  • 1158178 2024-002
    Material Weakness Repeat
  • 1158179 2024-003
    Material Weakness Repeat
  • 1158180 2024-004
    Material Weakness Repeat
  • 1158181 2024-005
    Material Weakness Repeat
  • 1158182 2024-001
    Material Weakness Repeat
  • 1158183 2024-002
    Material Weakness Repeat
  • 1158184 2024-003
    Material Weakness Repeat
  • 1158185 2024-004
    Material Weakness Repeat
  • 1158186 2024-005
    Material Weakness Repeat
  • 1158187 2024-001
    Material Weakness Repeat
  • 1158188 2024-002
    Material Weakness Repeat
  • 1158189 2024-003
    Material Weakness Repeat
  • 1158190 2024-004
    Material Weakness Repeat
  • 1158191 2024-005
    Material Weakness Repeat

Programs in Audit

ALN Program Name Expenditures
97.036 Disaster Grants - Public Assistance (presidentially Declared Disasters) $257.94M
84.268 Federal Direct Student Loans $2.11M
84.063 Federal Pell Grant Program $736,444
93.253 Poison Center Support and Enhancement Grant $504,792
21.027 Coronavirus State and Local Fiscal Recovery Funds $429,221
93.958 Block Grants for Community Mental Health Services $373,139
93.078 Strengthening Emergency Care Delivery in the United States Healthcare System Through Health Information and Promotion $253,881
93.391 Activities to Support State, Tribal, Local and Territorial (stlt) Health Department Response to Public Health Or Healthcare Crises $239,599
12.420 Military Medical Research and Development $189,991
93.839 Blood Diseases and Resources Research $182,439
93.069 Public Health Emergency Preparedness $154,980
93.788 Opioid Str $116,081
16.575 Crime Victim Assistance $109,282
93.994 Maternal and Child Health Services Block Grant to the States $100,610
93.866 Aging Research $92,805
93.173 Research Related to Deafness and Communication Disorders $89,163
93.669 Child Abuse and Neglect State Grants $86,338
20.600 State and Community Highway Safety $68,610
93.RD4 Asymptomatic Cmv $58,130
93.855 Allergy, Immunology and Transplantation Research $54,000
93.837 Cardiovascular Diseases Research $51,600
14.250 Rural Housing and Economic Development $48,000
93.847 Diabetes, Digestive, and Kidney Diseases Extramural Research $36,125
10.310 Agriculture and Food Research Initiative (afri) $32,756
93.361 Nursing Research $32,240
93.RD5 Research on Viral Infections $29,234
93.273 Alcohol Research Programs $27,437
84.007 Federal Supplemental Educational Opportunity Grants $27,182
93.310 Trans-Nih Research Support $20,470
93.073 Birth Defects and Developmental Disabilities - Prevention and Surveillance $20,000
93.853 Extramural Research Programs in the Neurosciences and Neurological Disorders $15,600
93.838 Lung Diseases Research $9,300
93.RD6 Gateway for Cancer Research: T2016-002 $8,100
93.889 National Bioterrorism Hospital Preparedness Program $8,093
93.RD2 Chop_cog_agct1531 $7,400
93.846 Arthritis, Musculoskeletal and Skin Diseases Research $7,147
93.RD3 Ecog-Acrin Ea4151 $5,550
12.420 Novel Topical Antibiotic Therapy to Reduce Infection After Operative Treatment of Fracturesat High Risk of Infection: Tobra -A Multicenter Randomized, Controlled Trial $5,350
93.394 Cancer Detection and Diagnosis Research $4,991
12.420 Evaluation of the Diagnostic and Therapeutic Value of Tissue Ultrafiltration in Patients at Risk of Acs $4,578
16.753 Congressionally Recommended Awards $3,885
93.110 Maternal and Child Health Federal Consolidated Programs $3,813
93.395 Cancer Treatment Research $2,940
93.399 Cancer Control $2,800
93.226 Research on Healthcare Costs, Quality and Outcomes $2,644
93.145 Aids Education and Training Centers $1,933
93.RD1 Alliance A011202 $900
93.558 Temporary Assistance for Needy Families $-186
93.121 Oral Diseases and Disorders Research $-394
16.758 Improving the Investigation and Prosecution of Child Abuse and the Regional and Local Children's Advocacy Centers $-1,800
93.840 Translation and Implementation Science Research for Heart, Lung, Blood Diseases, and Sleep Disorders $-2,565
93.865 Child Health and Human Development Extramural Research $-3,172
93.323 Epidemiology and Laboratory Capacity for Infectious Diseases (elc) $-6,584
93.360 Biomedical Advanced Research and Development Authority (barda), Biodefense Medical Countermeasure Development $-13,481
93.137 Community Programs to Improve Minority Health Grant Program $-25,698